What Are Medicare Special Needs Plans?

What Is a Medicare Special Needs Plan (SNP)?

A Medicare Special Needs Plan (SNP) is a Medicare Advantage plan providing specific, tailored benefits and services to specific Medicare populations. These plans are available to Medicare recipients with Medicaid, individuals with chronic conditions or special needs, and those living in institutions. Qualifying conditions include diabetes, end-stage renal disease, HIV/AIDS, chronic heart failure, and dementia.

Medicare SNPs include the same basic benefits as Medicare Advantage (MA) plans and are available as HMOs and PPOs. Through an SNP, a healthcare provider can tailor a patient’s care and services based on their situation.

Key Takeaways

SNPs are Medicare Advantage plans providing additional benefits for people with special needs.
Numerous SNPs are based on specific chronic illnesses or disabilities.
You must meet several criteria or requirements to enroll in a Medicare SNP.
Medicare SNPs are not available in all locations.

What Do Special Needs Plans Cover?

Established by the Medicare Modernization Act of 2003, Medicare SNPs are Medicare Advantage plans to cover people who meet special needs status requirements. All SNPs adhere to Medicare coverage rules and must cover medically necessary preventive services.

Medicare SNPs include the same basic coverage of an Original Medicare or Medicare Advantage plan (Parts A and B), plus Part D prescription drug coverage and additional services related to the SNP you qualify for. Like other Medicare Advantage plans, coverage may only be within a plan’s provider network. If you see a doctor outside the network, expenses may not be covered.

An SNP tailors benefits and services based on a patient’s needs. For example, an SNP designed to meet the specific needs of cancer patients may cover different services and prescription drugs than an SNP designed for congestive heart failure patients.

As with MA plans, some services or procedures require the plan’s prior authorization to determine if it’s covered. If the SNP determines a service is not medically necessary, you may have out-of-pocket costs. The Kaiser Family Foundation found that a higher percentage of prior authorization requests were denied for some SNP plans compared to Medicare Advantage plans from the same insurer.

Private insurance companies administer SNPs. For example, in California, SNPs are administered by recognizable companies such as Kaiser Foundation, Aetna Better Health, and UnitedHealthcare Community Plan of California.

Note

Medicare SNPs aren’t available in all locations. In California, some counties have multiple plans to choose from. In other counties, only two are available, or no plans at all. As with other Medicare Advantage plans, you must live in a plan’s service area to meet eligibility requirements.

Pros and Cons of Special Needs Plans

Pros

Targeted care for severe and chronic conditions
An all-in-one plan reduces shopping headaches
All SNPs include a care coordinator to help manage your individual health needs
Low or $0 premiums if you qualify for both Medicare and Medicaid

Cons

SNPs, networks, and providers not available in all locations
SNP plans may change or enter and exit locations every year
Potential prior-authorization headaches
Referrals needed to see out-of-network specialists

Three Types of Medicare Special Needs Plans

Medicare designs SNPs to meet the needs of patients with specific types of chronic conditions or disabilities.

Chronic Special Needs Plans (C-SNPs)

This type of SNP serves people with disabling long-term or severe chronic conditions. Each C-SNP plan has health benefits and specialized provider networks to serve people with specific chronic conditions, like chronic heart failure or diabetes.

The Centers for Medicare and Medicaid Services has approved C-SNPs for 15 specific conditions:

Certain autoimmune disorders
Cancer (excluding in-situ status and pre-cancer conditions)
Certain cardiovascular disorders
Chronic alcohol and drug dependence
Chronic heart failure
Certain chronic lung disorders
Certain chronic and disabling mental health conditions
Dementia
Diabetes mellitus
End-stage liver disease
End-stage renal disease (ESRD) requiring dialysis
HIV/AIDs
Certain neurological disorders
Stroke
Certain severe hematologic disorders

Dual Special Needs Plans (D-SNPs)

These plans are for dual-eligible Medicare recipients, meaning they qualify for Medicaid and Medicare. A D-SNP combines Medicare Part A, Part B, and Part D, and provides extra support to coordinate with Medicaid benefits, such as coverage of durable medical equipment. These are called Medi-Medi plans in some states (such as California).

Like other MA plans, D-SNPs typically provide some dental, hearing, and vision coverage, as well as a fitness club membership. While D-SNPs vary by location and insurance company, plans often offer additional benefits, including:

Credits for over-the-counter health products
Meal delivery
In-home support services
Personal emergency response system (PERS)
Transportation assistance
Acupuncture
Bathroom safety devices
Virtual medical visits with your physician

Individuals who receive partial Medicaid benefits fall into the partial dual eligible category. While full dual-eligible individuals can enroll in SNPs anywhere they are offered, seven states exclude partial dual-eligible SNP enrollment.

Institutional Special Needs Plans (I-SNPs)

These plans provide coverage for medical care in certain types of institutions such as long-term care nursing facilities. To be eligible for an I-SNP, you must need 90 or more days of care provided by one of the following service providers:

Inpatient psychiatric facility
Intermediate care facility for people with intellectual disabilities
Long-term care nursing facility
Long-term care skilled nursing facility
Skilled nursing facility

Medicare also offers Institutional-Equivalent Special Needs plans (IE-SNPs), which provide benefits for individuals who do not live in a care facility but need home-based care that’s at the same level as they would receive in a skilled nursing facility.

How Do I Find a Special Needs Plan?

To qualify for an SNP, you must be enrolled in Medicare Part A and Part B and meet other criteria. In addition, qualifications can vary by state in some cases—such as where Medicaid qualification is concerned.

If you recently qualified for an SNP, you’ll also likely qualify for a special enrollment period (SEP). A SEP allows you to sign up for Medicare Advantage plans such as D-SNPs outside the regular open enrollment period.

Qualifying for a Chronic Special Needs Plan

For a C-SNP, Medicare requires that the plan contact your current Medicare provider to verify that you have a qualifying chronic condition. Your eligibility must be reconfirmed annually.

You can also qualify if the company uses a pre-enrollment qualification assessment tool to get confirmation from your existing provider that you are eligible for that particular C-SNP. You can be disenrolled from the plan if eligibility isn’t verified during the first month of enrollment.

Qualifying for a D-SNP

To qualify for a D-SNP, you must qualify for Medicare (due to age or disability) and Medicaid. Dual eligible qualification depends on your state’s requirements regarding income, asset limits, and sometimes age. For example, you must be 21 in California to qualify for a D-SNP.

Some states are experimenting with automatic enrollment for those who qualify for dual enrollment.

You can choose between a D-SNP or traditional Medicare if you're dual-eligible. According to KFF, about half of people with dual eligibility stay with traditional Medicare, while some enroll in Medicare Advantage plans available to any beneficiary.

Qualifying for an I-SNP

For an Institutional Special Needs Plan (I-SNP), you must be eligible for Medicare Advantage and have had or be expected to need institutional services for at least 90 days.

You can enroll in an I-SNP before a stay if the I-SNP completes a CMS-approved assessment indicating your conditions will require at least 90 days of care.

I-SNPs can also enroll MA-eligible individuals not living in an institution but in the community. Similarly to the above, the I-SNP must use a needs assessment and methodology to qualify you according to state standards.

Frequently Asked Questions (FAQs)

What Do Medicare Special Needs Plans Cost?

If you're a dual-eligible enrollee, you may pay nothing for premiums, deductibles, and care visits because both Medicaid and Original Medicare pick up most costs. If you don’t have Medicaid, you’ll likely pay the Medicare Part B premium and an additional premium for the Medicare Advantage SNP. Some SNPs may require you to pay extra for prescription drugs, other benefits, or other out-of-pocket costs, depending on your needed services.

Do Medicare Special Needs Plans Charge a Monthly Premium?

Medicaid and Medicare cover most SNP costs for dual-eligible enrollees. However, Medicare-only enrollees may have to pay an additional SNP premium on top of their Medicare Part B premium.

Do Medicare Special Needs Plans Offer Drug Coverage (Part D)?

Yes. All SNPs include prescription drug coverage. Some SNPs design formularies to cover drugs most needed by their members. For instance, a C-SNP may cover common cancer or HIV medications. D-SNPs combine Medicare Parts A, B, and C coverages and Medicaid benefits.

What Are the Chronic Conditions That Qualify for a SNP?

To qualify for a C-SNP, you must be diagnosed with one or more of 15 chronic conditions, including cancer, dementia, chronic lung disorder, heart failure, stroke, or a neurological disorder. See above for the complete list of qualifying chronic conditions.

Can You Qualify for Both Medicare and Medicaid?

Yes. Medicare offers an SNP explicitly designed for individuals who receive Medicaid and Medicare benefits. More than 15% of Medicaid enrollees also receive Medicare benefits.

The Bottom Line

You may find Medicare SNPs are a good fit for you. These Medicare Advantage plans provide additional, tailored benefits and services for individuals with special needs due to income, complex conditions, or institutionalization. Three SNP types meet enrollee needs, and depending on the plan, you may benefit from reduced costs or additional coverage. Many SNPs typically offer dental, hearing, and vision coverage and extras such as meal preparation. Costs vary by plan; some SNPs require an additional monthly premium or out-of-pocket expenses.